liberals and superannuation

Extraordinary sacrifices that lead to a meagre retirement

December 16, 2022 by Madeline Lucre Leave a Comment

The NSW Government’s wage caps not only hurt nurses and midwives while they are working – they also have lasting, harmful consequences after they retire.

By 2021–22, an experienced nurse or midwife had already lost over $1700 in superannuation cont-ributions on top of the $17,500 reduction in their wages that year. Forecast forward, that loss of annual contributions swells to more than $2200 by 2023–24, according to the report by the Australia Institute.

After a decade of capped pay, super balances for experienced nurses and midwives were almost $7800 lower than if the pre-cap wage trajectory had been maintained. The loss grows quickly in future years – by 2023–24 the typical nurse or midwife will have lost over $12,500 in her or his super balance.

“As a result of the suppression of wages for public sector workers – made worse in real terms by the current surge in inflation – a growing proportion of the state’s essential service workforce will be unable to afford a comfortable retirement,” said the report.

This problem is compounded by the growing proportion of the population who have not been able to afford to purchase a home.

The report said the assumption that retirees own their homes outright is no longer realistic and will become even less so given the drop in real wages, galloping inflation and sky-high property prices.

“Only homeowners who are members of a couple will be able to afford a comfortable retirement. For single women who rent, their superannuation accumulations under existing wage caps do not even meet half of the requirement for a comfortable retirement.

“In short, compensation practices in the public health system need to be enhanced substantially, if these well-trained, dedicated workers are to achieve the fitting reward of a decent and secure retirement.”

NSWNMA General Secretary Shaye Candish said that thanks to the NSW Government’s ongoing wage caps, most nurses and midwives will fall well short of the thresholds considered for a “comfortable” retirement.

“The Government’s wages policy further entrenches gender pay inequality, as most public sector workers are women.

“Nurses and midwives across NSW will be unable to retire in dignity, the longer these cruel wage caps remain in place.”

Super win for women workers

April 7, 2022 by Madeline Lucre Leave a Comment

Poor superannuation policy costs the low paid $59 million a year.

The $450 threshold for superannuation contributions has been scrapped after years of union campaigning. The poor policy introduced by the Coalition government led to $59 million being withheld from the superannuation of low-paid workers every year.

Women – who make up 63 per cent of the workforce – who earn under $450 a month from a single employer, will benefit most from the change, say unions and superannuation funds.

“Removing the $450 threshold is a critical step in closing the gender superannuation gap, which sees women retiring with half the savings as men and 40 per cent of retired single women living in poverty,” said ACTU Assistant Secretary Scott Connolly.

“This is long overdue, and while the unions were fighting hard for it for years, consecutive Coalition governments allowed millions of dollars in superannuation to be lost.

“Poor retirement savings are directly related to insecure work and gig work, with some workers not being paid super at all under the $450 restriction despite working multiple jobs.

Superannuation must be paid on every dollar earned.”

The ACTU says much more needs to be done to ensure financial security in retirement for all Australians.

“To protect worker retirement, the government must ensure their commitment to increasing the superannuation guarantee to 12 per cent. Superannuation must also be paid on parental leave, to further close the gender retirement gap,” says Scott Connolly.

Liberals’ war on super unites employers and unions

August 6, 2021 by Madeline Lucre Leave a Comment

When employers join with unions to oppose government policy, you know the policy has to be on the nose.

Australia’s biggest employer organisation, the Australian Industry Group (AIG), sided with the union movement in opposing the Morrison government’s latest superannuation changes.

The government’s Your Future, Your Super bill was designed to weaken industry super funds – such as the health sector’s HESTA and Aware – and exert greater government control over them.

Industry funds are jointly managed by employer and union representatives, who work together to improve the retirement prospects of working Australians.

AIG chief executive, Innes Willox, joined ACTU president, Michele O’Neil, in writing a joint letter to Senate crossbenchers urging them not to pass the Your Future, Your Super bill.

In a separate statement, Willox said the bill was “disproportionate, ineffective and intrusive”, would “do more harm than good” and “leave more people in poor-performing funds for longer”.

Willox said the bill would “create new compliance burdens that would add new costs and risks, and would divert management and board attention away from improving retirement incomes of fund members.”

It would also “set a dangerous precedent” by giving the federal treasurer “arbitrary powers”, and would “add a new and unpredictable source of sovereign risk to the investment process”.

Community opposes government changes

Broad community opposition helped to persuade the crossbench and even some government MPs to successfully oppose aspects of the bill.

For example, the government was forced to remove a controversial power that would have allowed it to ban certain types of investments by superannuation funds.

The Morrison government claimed that “activist” industry funds were using their financial clout to “pursue political objectives at the expense of members’ interests”.

For example, some funds are ditching their investments in fossil fuels and looking at divesting from firms with poor environmental or industrial relations records.

However, industry funds routinely deliver far better returns for workers than the bank-owned retail super funds, which are politically close to the Liberal Party.

The rorts and rip-offs of retail super funds were exposed by the banking royal commission in 2018–2019.

Bank-owned funds were found to have charged fees to the dead, duped people into losing their life savings, and had broken the law thousands of times.

Nurses and midwives’ super under threat from backbench coup

June 30, 2020 by Rayan Calimlim 2 Comments

Australian Unions has called on the Prime Minister to reject calls from Liberal Party backbenchers to reverse legislated superannuation increases.

Liberal Party MPs, including NSW’s Dave Sharma, Jason Falinski and Craig Kelly, are currently pushing the Government to scrap legislated increases to superannuation, which have been slated to commence in 2021. These changes would see superannuation guarantees rise from 9.5% to 12% by 2025.

The scrapping of this policy would have major impacts upon the retirement savings of Australian workers, including nurses and midwives.

Australian Unions Assistant Secretary Scott Connolly has condemned the attacks on superannuation, describing the moves as “pandemic political profiteering”.

“If the Liberal Party’s only solution to the problems of the pandemic is to raid people’s super, then they’ve clearly run out of ideas”, Connolly said in a statement.

“These backbenchers need to be put in their place by the Morrison Government, and workers need to be given reassurance that their retirement savings will go up as currently legislated”.

These proposals from the Liberal Party backbench occur in the context of the Berejiklian State Government’s attempts to freeze nurses and midwives’ wages. According to the Centre for Future Work’s Dr Jim Stanford, this wage freeze proposal would further impact upon the retirement savings of health workers.

Nurses and midwives are currently guaranteed superannuation of 9.5%, while Federal Parliamentarians received superannuation of 15.4%. This is on top of their parliamentary pension and other post-parliamentary benefits.